When your credit is less than perfect, a subprime lender may require you to have a cosigner. If you have questions about what a cosigner can and can’t do, we’re here to help clear up some of the confusion by answering some frequently asked questions.

What’s a Cosigner and Why Might You Need One?

A cosigner is someone who helps the primary borrower get approved for a car loan. When someone agrees to be a cosigner, they agree to pay the auto loan in the event the primary borrower cannot. Whether or not you need a cosigner depends on your credit situation as well as the lender’s requirements. Many subprime lenders require a borrower to have a cosigner in order to get approved, as a cosigner gives the lender additional assurance that the car loan will be completed successfully.

Cosigner Questions

Cosigner Requirement FAQsFive cosigner questions we commonly get are:

Q: Is a co-borrower the same as a cosigner?

A: No, a co-borrower isn’t the same as a cosigner. Co-borrowers have ownership rights to the vehicle and can only be a spouse. A cosigner doesn’t have any ownership rights to the car, but is still responsible for the loan if the primary borrower is unable to make payments.

Q: Does my cosigner need good credit?

A: Yes, there are specific requirements a cosigner must meet, and one of these is to have good credit. Lenders look for a potential cosigner to have a credit score of at least 700.

Q: Can my cosigner be from out of state?

A: Yes, your cosigner can be from another state. As long as their credit is good, the lender typically won’t care where your cosigner lives. Some lenders can fax the documents to your cosigner to sign, but other lenders may require your cosigner to be present at the close to sign the loan documents.

Q: Does my cosigner need to be a US citizen?

A: Yes, they must be a US citizen and they can't just be a lawful permanent resident. Just because a person is legally allowed to live in the US doesn’t mean they’re afforded all the same rights as a citizen.

Q: Can my cosigner be retired or on disability?

A: Your potential cosigner can be retired or on disability – as long as their credit is good, the majority of lenders won’t care about their income source.

The Bottom Line

Make sure you and your potential cosigner know what you’re both getting into. It’s never a good idea to leave a cosigner in the dark, especially if it looks like you might have trouble making a payment. Once you’re ready to finance and have a cosigner ready, you can turn to Auto Credit Express to get you started in the car buying process.

We work with a nationwide network of dealers that have the lending resources available to help people with bad credit, no credit, and even bankruptcy. Using our service doesn't cost a thing and puts you under no obligation, so you have nothing stopping you. Go ahead and fill out our simple and secure online auto loan request form to get started today.